day of action

Today is the “Day of Action” for students in Canada. University students will organize marches and rallies calling for lower tuition fees, frozen tuition fees and/or the abolition of tuition fees. The debate–as far as it exists–about tuition fees and funding of universities is infused with an unsettling combination of sanctimoniousness and economic illiteracy. I can think of at least 3 arguments against low tuition fees:

1. Low tuition fees are not progressive.
Students (and most faculty I know) argue that post-secondary education carries with it benefits for society at large. As such, it should be funded by taxpayer money and individuals ought not to have to pay very much, if at all, for their education. But these people conveniently ignore the private benefits that flow to those who have a university degree. All those “progressive” students and faculty marching around today should ask themselves how progressive it is that the person who cleans the toilets in their university subsidizes an education which will lead to a relatively high salary.

2. Money doesn’t grow on trees (nor do microscopes, books, classrooms, professors or much else besides fruit).
In Quebec, tuition fees have been frozen at 1994 levels. Think about this for a moment before you decide to ditch Econ 101, grab a fair-trade soy latte and join the march. What else costs the same today as it did thirteen years ago? Lab equipment? Your professors’ salaries? Electricity? Anything? So while a large proportion of Quebec universities’ revenue has actually shrunk, all of their costs have continued to increase. Students in Quebec argue that the tuition freeze has not led to a decrease in quality. The obvious rejoinder to this is that holding that view is all the evidence we need to the contrary.

3. Lower tuition fees do not increase access.
The tuition freeze in Quebec, for example, has not increased the number of students from underprivileged backgrounds who go on to university. Not only have lower tuition fees not increased the number of low-income students, in fact Quebec has some of the lowest overall post-secondary participation rates in Canada. Furthermore, as a result of cutting an important revenue stream for universities, lowering tuition fees leads to a decrease in the number of places a university can afford to offer.

So what’s the alternative? I would guess that the vast majority of those taking “action” today assume that the alternative to no tuition fees is “American style” very high tuition fees. The result being that low-income people will almost certainly be left out. But that’s of course nonsense. One of the features of the current system (and even more so, one of lower tuition fees) is that it helps precisely those people who do not need the help. Namely kids from middle class families who can afford to send them to university anyway. It is these families who get the benefits of low tuition fees because they are more likely to send their children to university. The alternative, instead, is some form of variable tuition fees that takes account of students’ ability to pay (effectively argued for by Nicholas Barr, who serves the mixed grill). However, tuition fees should vary, not depending on a student’s family income (i.e. ability to pay while a student), but rather on the student’s salary upon graduation. Such a system helps underprivileged students who otherwise couldn’t afford to attend, while at the same time recognizing that post-secondary education can–and often does–result in significant economic advantage. Yes, education benefits society, but it is disingenuous to brush aside the private benefits. Concretely, it would mean raising tuition fees significantly from their current levels–for illustration, let’s say doubling them. But no one would pay anything during their university education; everyone would be entitled to a financial package covering the tuition. Part of the cost of this is covered by taxation and part by income contingent repayments. These payments are like a tax, but with the important difference that they are paid for only by those who actually went to university and benefited economically and the payments don’t continue forever.

If the students, faculty and politicians are really concerned about fairness and quality they shouldn’t argue for a system that leads to the opposite.

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